Novated Lease Benefits for Employers – Boost Retention & Staff Satisfaction
A novated lease is one of the most cost-effective employee benefits you can offer and it comes at little or no cost to your business. It allows your employees to finance and run their car through salary packaging, while you provide the payroll framework that makes it possible.
For employers, novated leasing can improve staff satisfaction, strengthen your recruitment appeal, and help retain valuable team members — all with minimal administration.
How Novated Leasing Works for Employers – Step-by-Step
Employee Chooses Their Car – New, used, or in some cases their existing car.
Lease Agreement Set Up – Between the employee, finance provider, and you as the employer.
Salary Packaging – Lease payments (and running costs, if bundled) are deducted from the employee’s pre-tax and post-tax salary.
Minimal Administration – Your payroll team processes regular deductions, while the provider manages the rest.
End of Term – Employee can pay the residual, refinance, or upgrade to a new vehicle.
Benefits of Offering Novated Leasing to Employees
Financial Benefits (for Employers)
Cost Neutral – No direct outlay for the business.
No Asset on Balance Sheet – Vehicle remains the employee’s responsibility.
Reduced Payroll Tax Impact – May lower taxable salary base (check with your accountant).
HR & Administration Benefits
Minimal Paperwork – Provider manages contracts, payments, and compliance.
Easy to Implement – Simple integration with existing payroll systems.
FBT Management – Provider ensures compliance with Fringe Benefits Tax rules.
Talent Management Benefits
Attract High-Quality Candidates – Stand out in competitive recruitment markets.
Boost Retention – Employees value salary packaging and lifestyle perks.
Increase Engagement – Staff enjoy the benefit of a new or better vehicle with reduced running costs.
Addressing Common Employer Concerns
Will it cost my business money?
No, the lease is paid entirely by the employee through salary packaging. Your role is simply to facilitate payroll deductions.
What if an employee leaves?
The novated lease is portable. It can be transferred to their new employer or the employee can take over payments directly.
Is it complicated to manage?
No, reputable providers handle contracts, compliance, and most of the admin. Your payroll team processes the agreed deductions.
Is it compliant with ATO rules?
Yes, novated leases are an established, ATO-compliant salary packaging method. Providers ensure your business stays within guidelines.
Enhance Benefits with Novated Lease
How Novated Leasing Benefits Employers and Employees
Working with One Car Group we deliver the benefits to your staff and save you the administrative burden of managing the leases.
Steps to Implement
One Car Group’s Novated Lease for Employers Program
Streamline Employee Benefits with Novated Leasing
The benefits to your staff are substantial. Here is an example of a Car Loan compared to a Novated Lease.
FAQs – Employer-Focused Novated Lease Questions
Can I offer novated leasing to all staff?
Yes, subject to your business policy and provider eligibility criteria.
Do I have to manage the lease?
No — the finance provider manages the lease, you only facilitate payroll deductions.
Does this increase my business liability?
No — the lease is the employee’s financial responsibility.
What happens if the car is damaged or written off?
The employee remains responsible for insurance and any shortfall.
Can I limit the types of vehicles employees choose?
Yes, you can set policy guidelines on vehicle age, type, or cost.
Are there tax benefits for the business?
While novated leases primarily benefit employees, some businesses may see reduced payroll tax liability.
How long does it take to set up?
Usually within a few weeks, depending on provider and payroll readiness.
Is novated leasing only for full-time employees?
No, part-time and contract staff may be eligible if their income is regular.
What if I have multiple locations?
Novated leasing can be implemented across all sites with centralised payroll.
Can we promote this as part of our recruitment package?
Absolutely — many employers list novated leasing in job ads and offer letters.